Taking another look at the unemployment benefits

Maybe we ought to take a second look at those unemployment benefits. Are they too generous?

The Wall Street Journal did the story. A recruiting firm out of Sacramento, California said they needed to find some engineers, six of them. They were offering good money—$60,000 a year.

They approached a number of people on behalf of an Oregon company trying to get those engineers to come to work. Unemployed engineers on unemployment payment said, “I’m not interested right now. I still have unemployment benefits that I haven’t used yet. If it was $80,000 I’d think about it, but for $60,000 I’m not going to quit.

Think about the implications of that. You’ve got people who have chosen to stay on unemployment rather than be gainfully employed. Why? Because we’ve got a government that has gone out of control with, what you might call, generosity.

Two years of unemployment benefits has incentivized some people (not all) to simply say, “I’ll start working again when my unemployment runs out”.

“For more Lars click here”

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  • a retired professor

    An Oregon firm was trying to recruit engineers from California? That’s what it sounds like.

    Are there no unemployed or recently graduated engineers in Oregon? I know quite a few recently graduated Oregon science majors in supposedly practical fields who haven’t found jobs, some after a year.

    And talk to all the people who are being thrown out in the street in Lane County.

    Sure, unemployment benefits reduce incentives to find work. That WSJ article cited studies which claim the that historically the average unemployment period increases by a couple of weeks or so. It’s not like most people end up loafing for months or years more than they would otherwise.

    The wretched economy has handed the Republicans a great opportunity. But if, like Lars Larson and Rush Limbaugh, their response is that the unemployed are just lazy welfare bums who need to have their checks cut off, they will not win.

    • Duh?

      I don’t see where he called them welfare bums in the above nor did he mention Rush Limbaugh. Perhaps your own biased political views and being a life long trough feeding public union man and PERS parasite has closed your eyes to objective processing.

      What they were saying was that for $60,000 it wasn’t worth uprooting their families and moving to a bankrupt, high tax and spend state but that for $80,000 it would be. They are willing to stay on the max $2250 a month unemployment in Oregon in hopes of finding a job until the bitter end. I personally don’t agree with their mindset but its their mistake to make, I just don’t want my tax money to have to keep paying for their bad decisions forever or your lavish retirement benefits either for that matter.

  • a retired professor

    Ah, pardon my intemperate language, you have set a good example for us. You will go a long way toward winning over the public employees when you enter into contract negotiations with them.

    He did say:

    “You’ve got people who have chosen to stay on unemployment rather than be gainfully employed. Why? Because we’ve got a government that has gone out of control”

    I interpolated (or is it extrapolated?) just a bit, but not much.

    By the way, a lifelong union man? I was in the teamsters for two years in my teens. That was about it. And in fact, I dropped out of PERS, too, when given the opportunity. Not that it matters: I earned the comparatively meager salary that Oregon pays its public university faculty. I have nothing to be ashamed of, and I’m not.

  • Bob Clark

    I don’t think it is the rate of unemployment compensation so much as the decision as to how long to keep extending the benefits. Congressional reps kind of have to do this balancing act of weighing the severity of economic recession against perversely rewarding non-productive behavior. The current recession is pretty significant compared to prior recessions so extending them beyond six months seems justified. But two years seems a little too rich. For isntance, if you are within a year or two of qualifying for social security benefits, your incentive to actively look for new work becomes somewhat thin if you can take a year or more of unemployment pay. In effect, the retirement age for government benefits is effectively shortened to maybe as early as 60 years of age. Of course, healthcare insurance remains a motivating factor, but maybe not too much longer because of the ObamaCare entitlement program.

  • Nobama

    An extension is nothing but “WELFAREEEEEEEEEEEEEEEEEEEEEEEEEEEE” GET A JOB

    PS: CUT TAX’S, CUT REGULATION, on the Private Sector “JOB CREATORS”
    Kick the Keynsians OUT

  • Rupert in Springfield

    Is anyone seriously going to argue that most of those we have known on unemployment don’t start seriously looking for a job until the last few weeks?

    I’m not talking about just in current times, I am talking about generally. My experience has been I rarely meet someone on unemployment who doesn’t for some weird mysterious reason stay on it for pretty much the exact amount of time benefits run for.

    I have no problem being critical of these people. They aren’t bad people, but there should be some shame in welfare benefits as that is societies only check valve on preventing everyone from loafing around.

    >Kick the Keynsians OUT

    Obama is not a Keynesian.

    Keynes had an economic theory that is incompatible with reality, thus it has never been tried. Basically Keynes said government could smooth out economic ripples by accelerating spending in bad times, and cutting back in good times. Where Keynes went wrong was in the foolish assumption that once politicians start spending that they will cut back when economic times are better.

    Liberal Democrats, such as Obama, are not using Keynesian theory. They try and claim they are to cloak their habits in some sort of economic jargon to give them credibility.

    Liberal Democrats are spenders. Not Keynesian. They believe in increasing spending during economic bad times, as well as increasing spending during economic good times.

    That’s just a love of spending, and thats not Keynes. Don’t let them trick you into thinking it is.

  • Jan

    Many of the dot-com darlings refused positions for less money then they had previously earned, choosing to stay on unemployment waiting for that big salary position offer. It didn’t come and by the time they were in a position of having to find work, there was no work to be had they moved home with Mom & Dad or ended up selling everything they owned.

    It is both foolish and lazy to refuse a position. At the very least, they are earning additonal future unemployment benefits in the event they are laid off again.

  • valley p

    If there is only 1 job available for every 5 or 10 people out of work in a given field, who cares if 1 of them refuses a job offer and waits a few more weeks for a better one? There are several others there to take the job. Besides that, most of the people out of work right now are in fields where there is no effective demand for their skills, i.e. home construction, real estate, and manufacturing. Those with college degrees, including engineers, are not in high unemployment categories, so why use them for your 2nd hand anecdotes Lars?

    Rupert writes: “Keynes had an economic theory that is incompatible with reality, thus it has never been tried.”

    Keynes knew more about reality than Rupert, is considered the greatest economist of the 20th century, the farther of modern economics, and his theories have been tested and used by governments for many decades. Reagan used Keynes for God’s sake. What do you think all that interest rate manipulation was about?

    In normal times, with full employment people spend money, and each of us in effect contributes to the well being of others by buying stuff or services they make or sell. In recessions, some of us are out of work and can’t spend, and others choose to not spend because we fear being next in the unemployment line. This can cause a self perpetuating cycle of deflation. Expanding the money supply is Keynes solution. Doing so has worked time and time again to help us get out of recessions. Not doing so has prolonged recessions, as happened in Britain in the 1980s.

    In full blown depressions, more is required because even an expanded money supply is not enough. People are scared, and they simply hoard any extra money. This is what happened in the 30s and is what we are on the brink of today. It is why even with interest rates at near 0, businesses are not borrowing and expanding, and people are not spending freely, but are increasing savings.

    Roosevelt increased deficit spending a lot his first few years and unemployment came way down from the high point of over 30% while the economy grew. But he did not do it enough or fast enough for the same reasons Obama is not today. There is a fear and resistance to deficit spending. Roosevelt even shut down deficit spending (disproving another Rupert theory about liberal democrats) and the economy tanked in 37-38. Then he ramped spending up again, especially during the war, and the economy boomed, proving Keynes theory worked. After the war deficit spending came way down,the Truman budget was in surplus (again disproving Rupert,) and the debt was steadily paid down until the Reagan years.

    (Clinton also cut spending, again disproving Rupert. 3 times is a charm, but never mind. He is oblivious to reality).

    Republican/conservatives/tea partiers today, and unfortunately some Democrats, are making the mistake of reverting to “classical” economic thinking that ruled prior to the great depression. The idea starts with the theory that government can’t do any good but can do harm, and then justifies having the government do as little as possible. Been there done that. It was called Herbert Hoover. But nearly everyone who lived through that is dead so we may be doomed to repeat the error and misery. Right now, if government tries balancing the budget we are headed for really hard times.

    • Rupert in Springfield

      >Clinton also cut spending, again disproving Rupert.

      Wrong

      Clinton did not cut spending. Spending feel in terms of a ratio to GDP but it was not cut.

      Ok – So its clear right off the bat you don’t know what you are talking about, but thats not a surprise when it comes to economic discussions. Its why I constantly warn you to avoid them.

      Spending fell as a percentage largely due to falling interest rates, thus lowering interest in the debt, and cuts in the military due to the end of the cold war.

      Clinton did cut spending in one regard – he shifted a lot of our debt from long term to short, thus getting a lower interest rate. That was a huge gamble at the time, but it worked out to be the correct one.

      Was Clinton Keynesian? Absolutely not.

      Why?

      Because Clinton wanted to spend spend spend.

      How do we know this?

      Because in 1994 – more than two years after his tax increases had been in effect, Clinton proposed nothing but $300B + deficits as far as the eye could see.

      Another example would be “the peace dividend”. A phrase coined under Clinton to express the desire to spend whatever was saved by military cuts as a result of the end of the cold war. Clinton wanted to spend it on health care. Hardly a Keynesian practice.

      Yes spending fell as a percentage of GDP under Clinton, but that is not the same as saying Clinton cut spending.

      Obviously you didn’t know that – now you do.

      >But he did not do it enough or fast enough for the same reasons Obama is not today. There is a fear and resistance to deficit spending.

      And here you go into full blown Dean idiot mode.

      First of all, once the money is appropriated for a stimulus, its already added to the deficit. Whether it is spent fast or slow has no impact in that regard. So your point about resistance to deficit spending is absolutely idiotic.

      Second – Obama was urged by every economist to release the money fast rather than slowly.

      This was urged because of the Japan experience in the 90’s moron. They did they exact same thing Obama did, Slow protracted release of money, and it accomplished nothing.

      Avoiding the Japan scenario was the key, and everyone, myself included, predicted the stimulus would be far less effective if the spending was drawn out.

      Did Obama listen to the economists?

      No.

      Obama spent slow, and got the results everyone predicted – a stimulus that by and large has been judged to be largely ineffective.

      No one out there thinks it did much good, and Obama put us $1T in the hole.

      Its decisions like that that have deservedly resulted in Democrats owning the deficit for a generation. Obamas cute trick of holding 70% of the stimulus funds until the year after implementation, 2010, to use as an election year slush fund looks to have backfired.

      People are on to this guy and Democrats in general. They don’t like what you guys are selling.

      That’s bad for Democrats, but probably best for the country. People are tired of the dictatorial attitude and insane spending and thats a good thing.

  • Rupert in Springfield

    Looks like the first oil rig – The Ocean Endeavor is set to sail from the Gulf to Egypt.

    Bye bye jobs.

    Hello more unemployment benefits. Hello increased oil spills from tankers.

    Thanks Obama – You panicked, went against the advice of your board of experts and now because you can’t admit you were wrong everyone has to pay a price.

    You know if you spent more time thinking about how to do your job, and a little less time on the golf course or blaming Bush maybe you wouldn’t be well on your way to being the worst president in US history.

    They are starting to not believe you anymore Obama.

    • valley p

      Amazing analysis Rupert, that has nothing to do with this topic anyway. The moratorium covered what…30 sites? We have an uncontrolled gusher and every available boom, ship and boat trying to scoop up the mess. The industry (and government) have proven they can’t manage a deep water event and you think more holes should be poked in the floor 4000 feet below the ocean surface for a few jobs? They say tying the same thing again and expecting a different result is a version of insanity. Congratulations on your condition. You are oblivious to learning.

      • Rupert in Springfield

        >Amazing analysis Rupert, that has nothing to do with this topic anyway.

        The topic is unemployment idiot.

        Obama is an expert at causing it with his antagonism to business. The oil rig moving is a good example of that antagonism affecting business – got that?

        You are so absurdly inept – did your mother have to hold your hand to cross the street until you were forty?

        >We have an uncontrolled gusher and every available boom, ship and boat trying to scoop up the mess.

        No we don’t have every available ship and boat you absolute nitwit.

        Obama has been turning away help left and right idiot.

        How could anyone be so ignorant as to miss that Obama wouldn’t allow foreign help for ages and when he does it goes through a long ridiculous process to get approval.

        Good lord – I don’t think if you sat down and tried you could possibly make yourself look more ignorant than you do with clockwork regularity on this blog.

        • valley p

          “The topic is unemployment idiot.”

          Uh oh. Rupert is calling me an idiot again. Must be losing another argument. So ok, you think allowing more gulf drilling will solve our unemployment problem. Logical fallacy in that we had an unemployment problem BEFORE the moratorium. and it has not gotten worse SINCE the moratorium, and the total number of jobs is piddling nationally. But don’t let math get in your way.

          And you are still left with the wisdom of poking more uncappable holes when one is gushing away.

          As for Obama being anti business. I guess that must be the reason the Dow is up 2000 since he was elected and corporate profits are at near record highs. Imagine if he loved them.

          “The oil rig moving is a good example of that antagonism affecting business – got that?”

          No. I don’t got that. How many gulf businesses have been put out of business by the BP oil mess? Answer, lots. So making a larger mess is going to help them how exactly? Or don’t they count?

          “Obama has been turning away help left and right idiot.”

          Fox news/Sara Palin urban myth. Fact Check.org says there has been only one refusal of a foreign vessel to assist. Is that egg on your face again?

          https://www.factcheck.org/2010/06/oil-spill-foreign-help-and-the-jones-act/

          “Good lord – I don’t think if you sat down and tried you could possibly make yourself look more ignorant than you do with clockwork regularity on this blog. ”

          Well if the shoe fits Rupert….and it seems to fit you awfully well. Lets add up your ignorant expressions just from 2 posts today:

          1) Allowing continued deep water drilling in the Gulf will solve unemployment. Wrong.
          2) Obama is anti business. Based on evidence, wrong.
          3) Obama has turned away foreign help in gulf: Wrong again.
          4) Clinton did not cut spending. Wrong despite your intellectual somersaults attempting to explain otherwise. He cut it well below the rate of GDP growth and balanced the budget as a result.
          5) You think there is no present resistance to deficit spending in congress. Wrong. Read the papers.
          6) The stimulus to date has been ineffective. Wrong. Responsible for 2 million jobs. Kept economy from further sinking. Has economy growing again.
          7) Democrats “own deficit for generation.” This is so wrong it is side splitting. See Bush Administrations. See Reagan Administration. See 16 straight years of Republican deficits.
          8) Clinton did not do Keynes. Yeah…he did. He surplussed the budget during good times. That is Keynes. Unlike Reagan and Bush, who squandered the budget. See point 7.

          Gosh Rupert, 8 factual flubs. I think you have set a new single day record. Care to add to it? Failing that, you can always call me more names. That should help make you feel better at least.

        • Larry

          Good lord – I don’t think if you sat down and tried you could possibly make yourself look more ignorant than you do with clockwork regularity on this blog.
          ===

          Maybe that is why he started out as dean and then various other names such as valley p, UofO student, former UofO student, retired UofO student, UofO Village Idiot, retired village idiot.

          Hard to determine who is who, but either they are all the same idiot, or dean has many long lost relatives who have stumbled on to the same web site to post their foolishness.

          • snkbyt

            Couldn’t have bben said any better Larry…ditto here exactly.!!

        • rural resident

          Democrats “own deficit for generation.”

          Rupert, you’ll hate the book, but if you want evidence that totally destroys your theory about which party is the party of deficits and which isn’t, read Thomas Frank’s, “The Wrecking Crew.”

          Dean, you’ll probably agree with much of what the book says, and you’ve probably read it already. But, if not, even you will be shocked at the descriptions of some of the things conservatives have done over the past 30 years in their attempts to destroy the government at all levels in the U. S.

          • valley p

            I have not read The Wrecking Crew, but did read Frank’s “What’s the Matter with Kansas.” I agree with the general idea that so called conservatives have been systematically trying to take government other than the military and prison system apart since Gingrich’s mercifully brief ascendancy. I say so-called because no real conservative (i.e. Burkean) would attack long standing institutions the way current ones like Rupert do with relish. “Revolutionary conservative” is an oxymoron.

            I’m hopeful that the continued rush to the crazy right in full regalia on Catalyst, while it may yield some short term sugar rush, will ultimately backfire and that a more realistic conservatism will reappear some years down the road. The nation needs pragmatic, responsible conservatives who take governing seriously, just like it needs pragmatic, responsible liberals like Obama.

  • Anonymous

    when i was unemployed, i had to report my weekly job search activity as a condition of payment. if i turned down an interview i would have been cut off. did that change?

    • Mary E. Rowe

      Folks claiming unemployment benefits are required to record their weekly job search activity. There is always the possibility that the claiments records will be audited. The claimant would then have to submit those search records to the unemployment department. Also, when the weekly claim for benefits is made, there is a list of 10 questions regarding the claimants job search to answer.
      I agree that some folks stay on unemployment longer than perhaps they should. However, there really are very few good jobs available. I also think the estimate of 4 or 5 applicants for a job is totally inaccurate. Let’s try 100 times that estimate. Example – about this time last year about 400 applications were received for a front office receptionist/clerk position at a construction company. Also, too many job descriptions include the statement bi-lingual (Spanish) preferred or required. Additional pay incentive is paid if the applicant has this skill. Some older folks are being forced into early retirement because they are a less desirable applicant and there are not enough jobs.

  • dartagnan

    Once again we see the favorite CON-servative / Republican tactic of using anecdotal evidence (Reagan’s welfare mothers driving Cadillacs, Larson’s engineers turning down $60,000 jobs) in place of solid empirical data. Although intellectually dishonest, this tactic is effective; as Reagan knew, people understand and remember stories better than dry statistics, and stories about welfare Cadillacs and freeloading engineers soon become part of the folklore.

    The CON-servatives did away with welfare with the help of such stories; now they’re trying to abolish unemployment benefits.

    Anybody who believes there are loads of good jobs going begging out there should quit his job and then try finding one.

  • Nobama

    All Democrats are Keynsians

    :–)

  • Nobama

    dartagnan: enjoy the THUMPING NOVEMBER 2

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